I believe it [iSCSI] to have a very bright future, especially with 10-Gb Ethernet on the way and the significant difference in acquisition costs between a complete iSCSI installation and a similar fibre channel setup.
I think 10Gb will be the tipping point for IP vs fibre based technologies - at my day job, we went SAN because of performance. It didn't fit our main application model, we've been NAS based on that particular app for years, but we wanted the performance of SAN, and the higher end technology offered in SAN solutions with regards to replication, and predictive support. We ended up having to re-work the application quite a bit to allow for SAN, however. It wasn't the drop in replacement we naively expected it to be.
Ethernet that's significantly faster than fibre could have made all that very different. Whether we'd gone iSCSI or more traditional network based protocols, we'd still have probably beaten the performance of the SAN - and that could have made things every interesting indeed.
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